Double Bottom Cryptocurrency Chart Pattern.

Crypto Candlestick Chart Pattern Recognition: Double Bottom pattern

By analyzing the most recent OHLCV price movements of the last days. Daily updated!

Double Bottom Pattern

The Double Bottom is a bullish chart pattern that resembles the letter 'W'. It is characterized by two consecutive troughs at approximately the same price level, with a peak in-between. This pattern indicates a potential reversal from a previous downtrend to an uptrend.

Characteristics of a Double Bottom Pattern:

• The two troughs should be significant and distinct, occurring after a notable downtrend.
• A peak between the two troughs represents a minor reversal or pullback within the larger bearish trend.
• The confirmation of the pattern is seen when the price moves all the way back up to test the resistance level formed at the peak.
• A decisive breakout above the resistance level often indicates a change in market sentiment from bearish to bullish.

In the Double Bottom function:

• The function first checks for the presence of data to determine the pattern.
• It identifies the first trough as the lowest price in the dataset, then searches for a second trough that is within a 3% price tolerance of the first one.
• The function requires at least one peak between the two troughs to validate the pattern.
• The peak should be a certain percentage higher than the troughs, signifying a temporary reversal in the downtrend.
• If a second trough is identified and the peak meets the required conditions, the function indicates the formation of a Double Bottom pattern.

The Double Bottom pattern is often interpreted by traders as a signal to consider opening long positions or closing shorts, as it suggests upward momentum may be forthcoming. However, traders should seek additional confirmation through other indicators and analysis to reinforce the pattern's predictive reliability.